High volume, diversity help Riverina take top wine exporter position

THE BRIDESMAID has become the bride, with new data revealing the Riverina exported more wine than the Hunter Valley for the second year running.

According to the lead trade body Wine Australia, the Riverina sold around $6 million worth of wine overseas during the past financial year whereas the Hunter Valley only sold around $4 million.

The wine export trade has suffered under the weight of the global financial crisis and the high Australian dollar but the Riverina has weathered the storm far better than the Hunter Valley.

Managing director of the region’s largest exporter, John Casella from Casella Wines, said the diversity, number and profitability of the Riverina’s wineries was responsible for the increased export volume.

“The Riverina is a very strong area which is why we are seeing these sorts of results, but I’m not sure if it will continue to grow, Mr Casella said.

“However, as a region we will certainly be able to sustain the current volume of wine.”

He said the industry would greatly benefit from a drop in the price of the Australian dollar but it is wasn’t the only factor.

“The Australian dollar is the strongest factor determining whether we will grow but other important factors include the currency prices in our export markets and the worldwide supply situation,” Mr Casella said.

“The lower the Australian dollar slips the more competitive we are because we have to deal with higher wages than our global competitors.”

The Wine Australia figures referred specifically to wine that bears the Riverina on its label without taking into account the vast amount originating from the region labelled South East Australia instead.

The complete amount of exported wine produced in the Riverina is worth in excess of $400 million.

News the Riverina has the edge over its nearest NSW rival is a rare glimmer of hope for the troubled industry.

Managing director of Westend Estate Wines Bill Calabria AM said there remains an oversupply and Westend hasn’t recommended growers plant any more vines on its behalf.

“Prices have been very low over the last seven vintages,” Mr Calabria said.

“It’s already hit quite a few wineries that have changed hands because they couldn’t hold on long enough and the banks have gone in.

“Coming in to next vintage I can see there’s going to be some major problems.”

Mr Calabria asked those sympathetic to the plight of the growers to remember that wine makers are subject to market forces.

“Wineries are price takers as well and the buyers have plenty of options,” he said.

“The dollar has to get to the eighty cent mark for things to pick up again and if it doesn’t wineries may clear stock whatever the price in order to keep the bank away.

“It is desperate times at the moment and we’ve still got a few bad years ahead.”